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[2018] ZAWCHC 76
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Westerhuis v Whittaker and Others (4145/2017) [2018] ZAWCHC 76 (26 April 2018)
Republic
of South Africa
IN
THE HIGH COURT OF SOUTH AFRICA
(WESTERN
CAPE DIVISION, CAPE TOWN)
REPORTABLE
CASE
NO 4145/2017
ANDREA
WESTERHUIS
Applicant
vs
KATHLEEN
WHITTAKER
First Respondent
SIMONE
WHITTAKER
Second Respondent
WILLIAM
STREET PROPERTY
INVESTMENTS
(PTY)
LTD)
Third Respondent
THE
COMPANIES AND INTELLECTUAL
PROPERTY
COMMISSION
Fourth Respondent
JUDGMENT
HANDED DOWN 26 APRIL 2018
KUSEVITSKY
AJ:
Introduction
1.
The First and Second Respondents (whom I
shall refer to as the Respondents or alternatively, the Whittakers)
are two directors of
the Third Respondent, William Street Property
Investments (Pty) Ltd (“the Company”). The First
Respondent holds 75%
of the issued securities in the Company and the
Applicant the remaining 25%. The Company owns an immovable property,
which is let
to commercial tenants, and conducts no other business.
The Whittakers are in control of the Company.
2.
In the Founding Affidavit, the Applicant
alleges that the Respondents have been taking unauthorised
remuneration in their capacity
as directors of the Company, and that
they have been running personal expenses through the books of the
Company without authorisation.
It is alleged that in doing so, that
the Whittakers have acted unlawfully in the gross abuse of their
position as directors, that
they have intentionally or by gross
negligence inflicted harm upon the Company within the meaning of
Section 162 of the Companies
Act 71 of 2008 (“the
Companies
Act&rdquo
;) and the business is being carried on in a manner (or had
a result) that is oppressive or unfairly prejudicial to the Applicant
as a minority shareholder within the meaning of
Section 163
of the
Companies Act.
3.
In
response to these allegations, the First
Respondent in the Answering Affidavit states that she has been
drawing a salary from the
Company and that she has been running
certain of her personal expenses through the books of the Company.
The First Respondent states,
however, that she has been doing this
with the knowledge and consent of the Second Respondent and that, for
various reasons, this
conduct is authorised. The First Respondent
contends that the shareholders agreed many years ago that the
director could take a
salary and run personal expenses through the
Company, that the Whittakers are running the Company in exactly the
same way as before,
and that they are accordingly doing nothing
wrong.
4.
The Applicant’s case is that the
conduct was in fact not authorised and that such conduct is
accordingly unlawful.
5.
The Applicant contends further that it is
essential that the Company be placed under the stewardship of at
least one completely
independent director. The Applicant accordingly
seeks orders declaring the Whittakers to be delinquent directors,
alternatively
placing them under probation and removing them and
appointing the Applicant and an additional independent director in
their stead
in terms of
Section 163(2)
(f) of the
Companies Act.
AN>
6.
During argument, counsel for Applicant abandoned its relief claimed
in terms
of prayers 3, i.e. a request for all financial information
and documents relating to the Third Respondent and prayer 5, an order
seeking the Respondents purchase the Applicant’s shares in the
company.
The
facts
7.
According to the Whittakers, the company is
a small family concern which was set up in 1971 by the late Liam
Whittaker, the father
of First Respondent, to carry on business as a
commercial letting enterprise. The company acquired immovable
property known as
Erf 17394 Cape Town at Paarden Eiland and situated
at 62 Marine Drive, Paarden Eiland upon which a factory was built.
Liam Whittaker,
until his death, was the sole shareholder of the
Company. On his death, these devolved in equal shares to his wife
Grace Whittaker
(“Grace”) and the Third Respondent, the
LF Whittaker Trust (“
the LFN
Trust
”).
According
to the Whittakers, the company was set up for two primary objectives,
the first, to provide Grace, First Respondent’s
late mother,
with employment and a source of income and secondly, to provide an
asset, in the form of the shares, to devolve upon
Liam Whittaker’s
heirs. The company holds as its sole asset, this commercial property
which is let to various tenants, and
is operated as a letting
enterprise.
8.
Grace was the sole director from 1971 until
her death in 2014. According to the Whittakers, she was also the sole
employee and was
the only person who received remuneration from the
company. In her latter years, Grace was unable to do all of the
required work
herself, and was later assisted by her daughter and
granddaughter, First and Second Respondent respectively, both of whom
ostensibly
assisted in managing the company’s rental enterprise
and did so gratuitously to ensure that Grace could continue receiving
her income.
9.
A few months before Grace’s death, First Respondent was
appointed as her
co-director because of concerns regarding the
former’s health. Grace remained both a director and the sole
employee of the
company until her death. After her death, First
Respondent took over her role as the executive director and sole
employee of the
company and as such attended to all of the functions
required to run its business, for which she continued to receive the
same
remuneration as Grace.
10.
Following Grace’s death in September 2014, Second Respondent
was appointed as a non-executive
co-director of the company.
According to them, she has never received any payment from the
company. In 2014, First Respondent inherited
50% of the shares in the
company from Grace’s estate, and a further 25% of the shares
from the LFN Trust. At the same time
Applicant, the niece of First
Respondent, and a grandchild of Liam Whittaker, inherited 25% of the
shares from the LFN Trust.
The
Issues
11.
According to the Applicant, the Whittakers have been running personal
expenses through the
books of the Company and they have been taking
unauthorised remuneration in their capacity as directors of the
Company. In her
founding affidavit, the Applicant states that from
the income statement of the company, it appears that “
employee
costs
” are reflected for the period 2015 and 2016 as R 157
000.00 and R150 000.00 respectively. According to her, the company
has
no employees. Ostensibly, to correct this position, the
Whittakers then gave notice on 30 September 2016 to call a
shareholders
meeting with the intention of passing a special
resolution which included:
“
1
– The ratification of the Director emoluments taken for the
year ended the 29 February 2016
2 – The
establishment of the 2017 financial year emoluments to be received.”
12.
At this meeting, which was held on 31 October 2016, the Applicant’s
representative
contended, upon advice from counsel, that the use of
the words “
previous
” and “
paid
”,
payments were in contravention of
section 66(8)
and (9) of the
Companies Act and
were not capable of being ratified.
Section 66
(9)
provides as follows:
“
(9)
Remuneration contemplated in subsection (8) may be
paid
only in
accordance
with a special resolution approved by the shareholders within the
previous
two
years.”
As
a result of this dispute, the shareholders meeting was postponed.
13.
Thereafter, on 1 November 2016, the
Whittaker’s through the Company, gave notice of a further
shareholders meeting which was to be held on 1 December 2016, for the
purpose of passing special resolutions for the approval of
directors
emoluments which were to be taken for the financial years ending 28
February 2017 and 28 February 2018. I am not told
whether this
meeting in fact took place.
14.
On the 20 January 2017, the Applicant received further communication
from the representatives
of Third Respondent. In it, they contended,
having taken advice from a recently retired Dean of Accounting and
the co-author of
the
Commentary on the
Companies Act
>,
Professor Geoff Everingham, that First Respondent was entitled to
take the amounts as reflected in the financial statements and
would,
in future, be entitled to such payments. The letter containing the
advice
inter
alia
provided as follows:
“
This
means that non-executive services where the Director fulfils a
non-executive function will require a special resolution in
terms of
subsection 9. Where the Director performs an executive function and
earns remuneration for the services rendered to the
Company a special
resolution is not required.
…
In the case of executive
Directors, their services as a Director must be distinguished form
(sic) their services as an employee
of the Company. Shareholder
approval is not required in the latter instance.
Simone Whittaker has to
date received no remuneration whatsoever from the Company. Kathy
Whittaker has been paid a salary of R 10,000
per month for services
and work performed to and for the Company. This salary was set by the
Shareholders of the Company more than
10 years ago and was condoned
by Standard Bank Trust which prior to the death of Grace Whittaker
was a 50% Shareholder in the Company.”
15.
According to Applicant, this version is contrived, as not only does
it conflict with their
previous position (which was the acceptance
that they were not entitled to receive remuneration without a special
resolution –
which was denied by the Respondents), but the
proposition was not sustainable in law. This is because the
Whittakers, in doing
so, would had to have acted through its
directors by negotiating contracts with themselves in their personal
capacities, and not
only was this not permitted under the
Companies
Act, but
it also constituted a breach of their fiduciary duties.
16.
The Applicant placed its reliance on
section 75(5)
of the
Companies
Act for
this proposition. In terms of this provision, if a director
of a company has a personal financial interest in respect of a matter
to be considered at a meeting of the board, then the director is
required to disclose the interest, its general nature and any
material information relating to the interest, together with any
observations or pertinent insights, and thereafter, to leave the
meeting immediately after making the aforesaid disclosure. In terms
of
section 75
(5), the said director must not take part in the
consideration of the matter and may not vote on the matter. It
therefore followed,
according to Applicant, that neither of the
Whittakers could have voted on a resolution to conclude employment
contracts with themselves,
and to the extent that they had purported
to do so, they would have acted in contravention of the
Companies Act
and
the employment contracts are void and unenforceable as a result.
17.
The First Respondent contends that after her mother’s death,
she was not only the
sole director, but had assumed her executive
role as the sole employee of the company. She did so on the same
basis as her mother.
This includes receiving the same employee
remuneration which Grace had received, but she would also be
reimbursed for her motor
vehicle and other expenses, such as her
computer used in for company business. Second Respondent was
appointed as her non-executive
co-director in November 2014 and
assists First Respondent in the running of the business. First
Respondent contends that she uses
her home as the company office,
visits the premises on one or two occasions per week, and utilises
her laptop and other home office
equipment to undertake the various
tasks on behalf of the company.
Evaluation
18.
Section 66
of the
Companies Act,
inter
alia
provides that the
business and affairs of a company must be managed by or under the
direction of its board of directors, which
has the authority to
exercise all of the powers and perform all of the functions of the
company, except to the extent that the
Act or the company’s
Memorandum of Incorporation (MOI) provides otherwise. The board of
the company must comprise in the
case of a private company or a
personal liability company, at least one director in addition to the
minimum number of directors
that the company must have to satisfy any
requirement, whether in terms of the Act or its MOI.
19.
A company’s MOI may also specifically authorize one or more
named persons to appoint
and remove one or more directors, provide
for one or more persons to be
ex
officio
directors of
the company and may also provide for the appointment or election of
one or more persons as alternate directors of
the company. More
importantly, in terms of
section 66(8)
of the
Companies Act, except
to the extent that the MOI of a company provides otherwise, the
company may pay remuneration to its directors for their service
as
directors, subject to subsection (9), which provides that this
remuneration may be paid only in accordance with a special resolution
approved by the shareholders within the previous two years.
20.
It is common cause that a company’s MOI is its founding
instrument through which the
business of the company obtains its
powers and authority to perform and exercise its functions. A
company’s MOI may also
contain restrictions as to the powers
and functions of a director and
inter alia
, the manner and
extent to which a company remunerates it’s directors.
21.
In
casu
,
the MOI or any other written instrument
[1]
directing how the Company is to be managed, is conspicuously absent.
I therefore have to approach this matter in terms of the new
Companies Act, 71 of 2008
.
22.
Section 76
of the
Companies Act addresses
the standard of conduct
expected from directors and extends it beyond the common law duty of
directors by compelling them to act
honestly, in good faith and in a
manner they reasonably believe to be in the best interests of, and
for the benefit of, their companies.
Section 76(3)
of the
Companies
Act states
that a director of a company, when acting in that
capacity, must exercise the powers and perform the functions of a
director in
good faith and for a proper purpose, in the best
interests of the company and with the degree of care, skill and
diligence that
may reasonably be expected of a person carrying out
the same functions in relation to the company as carried out by that
director,
and having the general knowledge, skill and experience of
that director.
23.
Such reasonable behavior will differ from case to case and will be
considered having regard
to the peculiar circumstances of the issues
facing a particular director. As in all cases involving negligence,
the test is essentially
an objective one, in that it postulates the
standard of conduct of the notionally reasonable director.
Specifically, in
section 77(9)
of the
Companies Act, a
court may
relieve a director from any liability if a court considers it just if
it appears that the director, having regard to
all of the
circumstances of the case, including those connected with the
appointment of the director, it would be fair to excuse
the
director.
[2]
24.
In her answering affidavit, First Respondent stated that after her
mother’s death,
she ran the company in exactly the same way as
her mother had done. Against this backdrop, it is evident that we are
dealing with
a small family enterprise, initially created with the
intention of benefiting it’s family members. It has long been
accepted
that in these types of companies, compliance with
formalities usually take a back seat and typically, strict compliance
with formalities
are often relaxed precisely because of the relative
closeness of the participants. In
casu
, the manner in which
Whitakers operated was no different. It is not disputed that Grace
received remuneration from the Third Respondent.
According to the
Respondents, this remuneration was within the knowledge of all of the
shareholders, including Standard Trust who
was the other shareholder
along with Grace. Furthermore, given the purpose for which the
company was established, it was not disputed
that the company was
purposefully created to ensure an income stream via the only asset in
the company. I was told that throughout
the company’s
existence, at least 75% shareholders knew and approved of the
executive director’s employment and remuneration.
After Liam
Whittacker’s death, Grace held 50% of the shares and the
remaining 50% were in the LFN Trust controlled by Standard
Trust.
After Grace’s death, First Respondent holds 75% of the
requisite shares required for a special resolution.
25.
There is nothing before me that suggested that prior to First
Respondent’s obtaining
her shareholding in the company, that
resolutions were taken which entitled Grace, as shareholder, to her
remuneration. But this
is not a question that I have to dwell on for,
in the absence of the MOI, I have to accept the Respondents’
version that
the income received, at least insofar as it related to
Grace, was as contemplated by the founder of the Company.
26.
Furthermore, it is also self-evident that First Respondent, and
before her, Grace was the
employee of the Company. There is no
dispute that the premises is occupied by tenants. According to the
financial statements of
the company which was attached to the
Applicant’s founding affidavit, it reflected the company to be
operating as a rental
enterprise and generating a rental income of R
400 00.00 per annum. The only dispute in this regard involves the
Applicant’s
complaint that the functions performed by her are
vastly overstated. In my view,, whether or not one or three invoices
require
to be sent out to a tenant per month, or whether the premises
need to be checked on once or three times per month, does not detract
from the fact that the company requires someone to fulfill the
administrative duties and functions of a landlord and management
agent, and that someone is charged to administer those functions on
behalf of the company. I have to accept that First Respondent
administers this function. Against that backdrop, one must accept
further that First Respondent carries out this function in a
position
as an employee of the Company notwithstanding the fact that she is
also a shareholder. Put differently, the mere fact
that she is a
shareholder does not preclude her from being an employee of the
company as well. Counsel for Respondents relied on
Henochsberg
[3]
who expressed the position as follows:
“…
usually
an executive director is appointed as director and also as employee,
he holds two positions in two different capacities.
This dual
capacity is important in company law and in labour law…. As an
employee he will also have the duties of an employee
in addition to
that of director … He could receive remuneration as a director
and as an employee or in one of either capacities.
27.
Similarly, a director can also be an employee in addition to holding
the independent office
of director.
[4]
I am therefore of the view that the remuneration provided to the
First Respondent is not unauthorised. With regard to Second
Respondent,
no evidence was adduced at all to support a claim that
she was receiving any remuneration from the Company. Accordingly, the
claim
that she has received unauthorized remuneration is unfounded.
Delinquent
directors
28.
The other basis upon which the Applicant contends that the
Whittakers’ conduct have
brought them within the realms of
having being declared delinquent directors, is the claim that they
are running personal expenses
through the books of the Company
without authorisation. It is this behaviour that is inflicting harm
on the Company and accordingly,
they are acting in a manner that is
oppressive or unfairly prejudicial to the interests of the Applicant
in her capacity as a minority
shareholder.
The
legal framework
29.
Section 162(5)(c)
of the
Companies Act reads
as follows:
“
(5)
A court must make an order declaring a person to be a delinquent
director if the person –
…
(c)
While a director -
(i)
grossly abused the position of director;
(ii)
took personal advantage of information or an opportunity, contrary to
Section 76(2)(a)
;
(iii)
intentionally, or by gross negligence, inflicted harm upon the
company or a subsidiary of the company,
contrary to
Section 76(2)(a)
;
(iv)
acted in a manner –
(aa)
that amounted to gross negligence, wilful misconduct or breach of
trust in relation to the performance
of the directors functions
within, and duties to, the company; or
(bb)
contemplated in
Section 77(3)(a)
, (b) or (c);
0c
m; line-height: 200%">
30.
To the extent relevant,
section 163
provides that a shareholder or a
director of a company may apply to court for relief if:
‘
(a)
any act or omission of the company, or a related person, has had a
result that is oppressive or unfairly prejudicial to, or
that
unfairly disregards the interests of, the applicant;
(b) the business of the
company, or a related person, is being or has been carried on or
conducted in a manner that is oppressive
or unfairly prejudicial to,
or that unfairly disregards the interest of, the applicant; or
(c) the power of a
director or prescribed officer of a company, or a person related to
the company, are being or have been exercised
in a manner that is
oppressive or unfairly prejudicial to, or that unfairly disregards
the interests of, the applicant.’
31. A court is also
empowered in terms of
section 163
to make any interim or final order
including:
‘
(a)
an order restraining the conduct complained of; …
(e) an order directing an
issue or exchange of shares; …
(i) an order requiring
the company … to produce to the court or an interested person
financial statements in a form required
by this Act, or an accounting
in any other form the court may determine.’
32.
In
Geffen
and Others v Dominquez and Others
[5]
,
Davis J stated the following in relation to an enquiry in terms of
section 163:
“
[23]
In
Grancy Property Limited v Manala
2015
(3) SA 313
(SCA), Petse JA, on behalf of a unanimous court, noted
that the substantial body of case law dealing with s 252 of the
Companies
Act 61 of 1973 which was repealed by the 2008 Companies
Act, is, in material respects, equivalent to s 163 of the Companies
Act.
Thus there is a benefit to be derived from considering the
previous jurisprudence as to what constitutes oppressive or unfairly
prejudicial conduct. Unfortunately, this judgment did not lay down
its own test but it is fair to say that it relied upon and thus
confirmed a number of decisions, in which the court had engaged
previously with what constitutes oppressive or unfairly prejudicial
conduct. What emerges therefrom, is that an applicant for relief
under the section cannot simply make a number of vague and
generalised
allegations but has to establish:
1. The particular act or
omission that has been committed, or that the affairs of the company
have been conducted in the manner
so alleged.
2. Such act or omission
or conduct of the company’s affairs is unfairly prejudicial,
unjust or inequitable to the applicant
or some part of the members of
the company.
3. The nature of the
relief that must be granted to bring to an end the matters of which
there is a complaint; and
4. It is just and
equitable that the relief be so granted.”
33.
The
court also held that the judgment in
Grancy
Property Ltd
,
supra
also made it clear that the conduct of the majority shareholders had
to be evaluated in the light of a fundamental principle of
company
law, namely by becoming a shareholder, the latter undertakes to be
bound by the decisions of the majority shareholder/s.
It therefore
follows that not all acts which prejudicially affect a minority
shareholder or which disregard his or her interests
will entitle a
minority group to the relief set out in the section.
[6]
34.
In argument, counsel for Applicant, Mr Cutler referred to
Gihwala
and Others v Grancy Property Ltd and Others
2017 (2) SA 337
(SCA)
where the court ruled that the delinquency order against two
directors was entirely justified, finding that their conduct fell
within the scope of section 162(5)(c) of the Act where they had
excluded Grancy from the benefits of an investment which it had
substantially financed, whilst the two directors, Mr Gihwala and Mr
Manala, took the benefits for themselves and for their own
personal
enrichment.
35.
Mr Cutler relied on the following paragraph as the test to be applied
for delinquency:
“
[139]
These actions caused harm to SMI. It was in my view
wilful
misconduct on the part of Mr Gihwala and Mr Manala
because
it was entirely intentional and with knowledge of the obligations
owed to Grancy under the investment agreement. But at the very least
it was gross negligence akin to recklessness. It involved
a breach of
trust in relation to their performance of their duties as directors.
It was entirely inexcusable and ongoing as evidenced
by their
endeavors to avoid complying with their obligation to provide a
proper accounting to Grancy in regard to its investment.
A
declaration of delinquency was entirely justified. (my emphasis)
36.
It is trite that a court has to decide, firstly, if an applicant is
entitled to relief in
terms of section 163 and if so, which factors
need to be considered in making the decision. A court is also tasked
to adjudicate
on the alleged breach of the directors’ duties in
terms of section 75. The First Respondent alleges that, as she is the
Company’s
only employee, she performs all of its business
functions and that these require the use of her own motor vehicle,
laptop ,telephone
and fax and utilizing part of her home as an office
for the Company. The second complaint by Applicant relates to alleged
unauthorised
loans. In this regard, the only allegation that is made
on this aspect in the founding affidavit is as follows:
“
The
February 2016 financials also disclose unauthorised loans to the
First Respondent and the Whittaker Family. Trust. These unauthorised
loans need to be investigated.”
37.
According to the Respondents, both of the loans are reflected in the
Company’s audited
financial statements. The first loan in the
amount of R 154 043.00 and marked “K Whittaker” is
unsecured, and was made
to Grace prior to her death and was assigned
to First Respondent as her heir. It was therefore not a loan for
which either of the
Respondents were responsible. The second loan,
according to the Whittakers, is an unsecured loan of R 424 496.00
made to the Third
Respondent, which bears interest at prime plus 2%
and has no set terms of repayment. According to them, neither of
Respondents
derive any personal benefit from the loan, which is to
the Trust, of which the Applicant is a beneficiary. There is
therefore no
evidence that the Company is in any way prejudiced by
the loan, from which it derives its interest.
38.
The collective circumstances described in section 162(5(c) are
categorized as ‘
substantive
abuses of office’
[7]
.
What this requires, according to the Respondents, are actions by
directors, evaluated objectively, which fall far short of the
standard of the reasonable director. They argue that none of the
complaints complained about could be criticized as grossly negligent,
wilful, fraudulent or a gross abuse of office. I tend to agree. In
fact, throughout the answering affidavit, First Respondent reports
that this is how they have always done things and on this basis,
alone, there can be no finding that the conduct complained of
can be
construed as wilful or fraudulent.
39.
It is trite than an applicant must make out his or her case in the
founding papers. In
Bayat v Hansa
1955 (3) SA 547
(N
) at 553
held the following:
‘
An
applicant for relief must (save in exceptional circumstances) make
his case and produce all the evidence he desires to use in
support of
it in his affidavits filed with the notice of motion whether he is
moving ex parte or on notice to the respondent and
is not permitted
to supplement in his replying affidavits (the purpose of which is to
reply to averments made by the respondent
in his answering affidavit)
still less to make a new case in his replying affidavits.’
40.
Furthermore, given that these are motion proceedings and that quite
clearly, there exists
disputes of fact, I have to consider this
matter in light of the accepted principles as enunciated in
Plascon-
Evans
[8]
.
I was also confronted with an application to strike out by the
Respondents on the basis that Applicant sought to supplement her
rather sparse founding affidavit in Reply. It is trite that it is
impermissible to make out new grounds for an application of this
nature in a replying affidavit
[9]
and accordingly I do not deem it necessary to deal with the striking
out application. These questions therefore have to be answered
on the
basis of the founding affidavit and the answering affidavit.
[10]
41.
According to the Respondents, the Applicant has not only failed to
demonstrate cognizable
facts evidencing ‘
gross misconduct
’,
‘
gross negligence’
, a ‘
fraud’
upon her a shareholder, or an abuse of trust on the part of the
Respondents, but she has also failed to produce sufficient evidence
to support a claim that the Respondents have inflicted any harm on
the company.
42.
There is clearly a loss of trust and a breakdown of the relationship
between the shareholders
in this small domestic company. Courts have
previously come to the assistance of shareholders who find themselves
in this position
by winding up a company on just and equitable
grounds where the relationship between the partners have become
untenable. However,
I make no pronouncements in this regard. In this
application, however, based on the conspectus of the evidence before
me, I am
constrained to find that the Applicant has not made out a
case for a finding of conduct amounting to delinquent behaviour
within
the meaning of sections 162 and 163 of the Companies Act.
43.
I was also called upon to make a finding in terms of section 162
(7)(iii) of the Companies
Act. This provision provides that:
(7) A court may make an
order placing a person under probation, if-
(a) while serving as a
director, the person-
(i)
…
(ii)
…;
(iii) acted in, or
supported a decision of the company to act in, a manner contemplated
in section 163 (1)”
44.
Mr Cutler argued that a finding in terms of section 162 was not a
sine qua non
for a finding in terms of section 163. Thus if
they have not made out a case in finding the directors delinquent,
then the alternative
relief is putting the Respondents on probation
in terms of section 162(b). According to Respondents, no cognizable
facts which
meet the requirements of section 162(8)(a), which are
pre-requisites for a probationary order, have been met. I agree.
Since I
have found that there is no basis for the relief in a finding
that the Respondents conduct were oppressive or unfairly prejudicial
to the Applicant, similarly there is no factual or legal grounds
proffered which would entitle the Applicant relief in terms of
Section 163(2)(f)(i). In my view, the Applicant has not made a case
out for a finding in terms of section 162.
45.
Lastly, in relation to the relief claimed in Prayer 4 for payment of
money as repayment
or compensation, I am of the view that even had I
found the Respondents conduct to have been oppressive and prejudicial
to the
Applicant, this claim would not have been competent in this
application as this court would not have been in a position to
identify
or determine what amounts should be repaid, in what would
clearly have been an illiquid claim.
Conclusion
46.
In summary, I am unable to find that Applicant has made out a case
for declaring that First
and Second Respondents are delinquent or
that their conduct has been oppressive or unfairly prejudicial or
disregarded the interests
of the Third Respondent or the Applicant in
a commercial sense.
Order
:
In
the circumstances, I issue the following order:
1.
The application is dismissed with costs.
KUSEVITSKY
AJ
[1]
Since
this company was created in 1971, it would have had as its founding
documents, a Memorandum of Association and Articles
of Association
in terms of the old Companies Act but the new
Companies Act 71 of
2008
allowed companies to file a notice of amendment of its current
founding documents to bring it in line with the new Act by 30 April
2013
[2]
Subsection
9(b)
[3]
Henochsberg
On the
Companies Act 71 of 2008
, Vol.1 at p76(1)
[4]
Amazwi
Power Products (Pty) Ltd v Turnbull JA (2008) 29 ILJ 2554 (LAC):
14/07 20 June 2008at para 12
[5]
(4501/2014)
[2017] ZAWCHC 118
(17 October 2017) at para 23
[6]
Ibid
para 24
[7]
Grancy
Property Ltd v Manala
[2013] 3 ALL SA 111
(SCA) at para206
[8]
Plascon-Evan
Plaints Ltd v Van Riebeeck Paints (Pty) Ltd 1984 (3) SA 623(A)
[9]
Director
of Hospital Services v Mistry
1979 (1) SA 626
(A) at 635-636
[10]
Geffen
supra
at para 41